Andy Burnham and John Healey have been warned that any proposal to raise capital gains tax (CGT) during the upcoming Budget could face challenges. The government recorded a CGT tax take of £198 million in August, an increase of £8 million compared to the same period last year. There are rumors that the Budget next month could include a plan to increase CGT to boost Treasury revenues. However, experts have cautioned that such increases may not yield the expected results due to the unpredictable nature of CGT. Capital gains tax is paid when assets are sold for a profit, such as property, shares, cryptocurrency, or other possessions. Individuals have a £3,000 annual allowance before CGT applies, and the tax rate can be 18% or 24%, depending on their tax band and other factors. While some experts suggest that increasing CGT rates could lead to higher tax collections, investors may respond by holding onto assets longer or altering their investment behavior to avoid higher tax bills. Rachael Griffin, a tax expert at Quilter, noted that aligning CGT rates with income tax rates could increase tax due on investment gains but warned that investors might adjust their behavior in response to higher rates. Sarah Coles, head of personal finance at AJ Bell, mentioned that CGT receipts have been volatile, with overall collections since April being lower than the previous year. She highlighted that people may sell assets before tax changes and hold them longer afterward to avoid heavy tax bills. Susannah Streeter, chief investment strategist at Wealth Club, suggested that the government might be looking at CGT as a potential revenue source to offset reductions in the personal income allowance. Assets such as shares can be held in tax-efficient wrappers like ISAs or SIPPs, which avoid tax bills upon sale. Staggering sales around key dates can also help manage tax liability.